So much for the domestic industry and the emerging preferences of some of China’s new wine consumers. What about imports?

Bottled importation of wine is barely fifteen years old as a market in China. Some wine importers have come or gone – or reinvented themselves – but it’s still a young market, obviously. Out at the front are Aussino and ASC battling for dominance in an environment unlikely to admit monopoly influence for any company in the long term. Other importers like Torres China – of the great eponymous Spanish wine family – Summergate, DT Asia, East Meets West, among many others, occupy a more middle ground. Then you have smaller specialist merchants and importers like Ruby Red Fine Wines, Globus Fine Wines and The Wine Republic who are serving to diversify the market. Companies traditionally stronger in Hong Kong and Macao, such as Watson’s Fine Wines and Links Concept, are now also active in the Chinese mainland.

This diversification is more than welcome and has yielded the odd surprise or two. Who would have thought, for example, that grower Champagne or domaine Burgundy (outside of DRC) would find a market, albeit small, in China and so soon? Although the global economic situation has slowed the market for bottled imports in China – and has certainly affected the higher end of the F&B industry – perhaps international wineries will turn to China as a new destination for wines proving a tougher sell in other parts of the world. Well, we live in hope at least.

As in other immature markets, high-end Chinese consumers gravitate to France and to Bordeaux especially. There is nothing wrong with this, of course; and it’s gratifying to see some of France’s top wines hitting China’s import lists. But the bottom end of the quality pyramid also travels to China and at maddeningly daft prices once tax and retail are factored in (taxes amount to about 48%). The ‘French obsession’ is even a factor in the market for domestic wines where Chinese oenologists – some of whom have French connections – deliberately model their Chinese wineries on French tradition (or a comical version of it). It is for this reason that most Chinese reds are packaged in Bordeaux bottles.

But Australia and Chile are not far behind France in carving up significant chunks of the import scene, helped by beneficial trade agreements. What is more surprising is the possibility of turning novice Chinese palates on to wines that some industry insiders thought impossible to sell (like those grower Champagnes following on the heels of the Grande Marques). For example, Madeira, albeit in very small quantities, has a tiny but enthusiastic following in Beijing – at least we’re trying to spread the word! Moscato d’Asti does well too, although this makes sense given the Chinese tend to shun noticeably high acidity, react well to residual sugar and, in some cases, prefer not to stomach high alcohol. Not that the Chinese can’t drink: they can! It’s the northern Chinese who consume the most alcohol, whilst some southern Chinese struggle to produce alcohol dehydrogenase, or at least enough of this enzyme to process alcohol effectively (hence the ‘pink-face-after-a-glass’ routine).

So if Chinese wine drinkers are keen to try different international wines – sometimes irrespective of the ‘French is best’ mantra – we should also expect to see more diversified and more ‘regional’ preferences emerging, i.e. in terms of what wines sell well in different parts of the country.

Among the ‘first-tier’ cities (Shanghai, Beijing, Shenzhen, Guangzhou etc.) a relatively full range of international wines is available and consumers here differ considerably in spending power and whether or not they drink Chinese wine. Among nominal ‘second-tier’ cities (Dalian, Qingdao, Chongqing etc.) the preference for, or at least tendency to drink, Chinese wine over international imports will be more marked; but this picture is changing, especially among the younger generation.

Beyond that – China’s ‘third-tier’ cities and places with a population of one million that hardly appear on the map – wine is rarely consumed at all (expect Chinese spirits and beer). But I’m hopeful that, one day, regional preferences for specific wines will emerge, no doubt along the lines of different Chinese provinces’ regional cuisines and what works from a food-and-wine matching point of view. This would be ideal, if some considerable way off, culturally speaking.

A final word by way of illustration: during the Olympics my wife, Fongyee, was invited to open a wine store in Hubei Province and was asked to give a talk on wine-tasting to some two hundred invited guests. After the talk – and shooting a slightly bizarre ad for local TV – she was invited to a banquet as the ‘Wine VIP’, fresh in from Beijing (or as fresh as you can be after a fifteen hour journey). But no sooner had the guests sat down, out came the bai jiu白酒(a category of high alcohol spirit made from Chinese grains), complimentary packets of cigarettes and endless bottles of beer. No wine to be seen anywhere. No one could question the generosity of spirit (no pun intended); but, equally, no one should expect the remoter parts of China – even its remoter developing cities – to be fountains of wine appreciation any time soon.

This post was written by:

Based in Beijing, Edward Ragg reports on the ever-changing and developing wine industry in China and abroad. Edward Ragg is co-founder, with his wife Fongyee Walker, of Dragon Phoenix Fine Wine Consulting, Beijing’s first independent wine consulting company. A former Captain of the Cambridge University Blind-Wine Tasting Team and a Landmark Tutorial Scholar (2010), he has judged at the International Wine Challenge (UK), Shanghai International Wine Challenge, China Wine Challenge, Wine 100 (Shanghai) and was guest international judge at the 2012 McLaren Vale Wine Show. Ragg holds the WSET Diploma and qualifications from The Court of Master Sommeliers and Society of Wine Educators. He is a WSET Educator and WSET Level 3 Assessor. A writer in a number of fields, his books include A Force That Takes (Cinnamon Press, 2013), Wallace Stevens and the Aesthetics of Abstraction (Cambridge University Press, 2010), and Wallace Stevens across the Atlantic – co-edited with Bart Eeckhout – (Palgrave, 2008). He contributes regularly to poetry magazines and wine journals (selections from his poetry can be found in Lung Jazz: Young British Poets for Oxfam [2012] and the Carcanet anthology New Poetries IV [2007]). He is Associate Professor in English at Tsinghua University and brother to Michael Ragg, MD of Burgundy producer Mischief & Mayhem.

7 Responses to “Chinese Wine Culture(s): Part III”

I have read, with great interest, your analysis of the Chinese culture in relation to wine consumption.

I opened a wine import and distribution company in Hong Kong last year, knowing that this market is way ahead of China vis-a-vis wine consumption. I am also well aware of the immense potential in China and recognize the fact that it will take some time for the Chinese to incorporate wine into their culture, especially those coming from third tier cities.

However, what is truly exciting about this market is the versatile nature of this culture. In a short period, many have adapted to Western-style lifestyles that include the latest trends in fashion, food, wine and travel. This evolution continues at a rapid pace, surprising many foreign visitors as they discover the old and the new China. I have written 3 blogs on this subject.

As for myself, I am committed to seeing the emerging wine market unfold and I have the ring-side seat to make the most of it. I also see our presence in the region as having an impact on the growth of the wine market.

One key group of foreign wine importers / distributors is missing: huge Chinese companies that produce wine. These include COFCO, which is best known for its Great Wall wines and is handler of Pommery Champagne, among other imported wines, and Changyu, which produces wine under its own name and recently took over distribution in China of JP Chenet wines. Given the resources these companies have in China they are in a position to play an increasing role in the imported wine sector.

Because of the immense demographics, there is a need for specialty wine importers to establish alliance with larger companies in order to cover the market effectively with proper logistics and professional workforce. My company in Hong Kong, Portfolio Asia Wine & Spirits Ltd. is a small importer/distributor of specialty wines from small to medium size quality producers. I am open to discussions about this issue that I have put forward. My blog is http://wineportfolio.blogspot.com/

Thanks, Leo, both for your comments on the posts and for your own contributions above. I’ll have a look at your blogs and would be interested to know more, certainly, about Portfolio Asia Wine & Spirits. The relationship between Hong Kong and mainland China, with respect to imported wine, is likely to become ever more fascinating, even as these operate as distinct markets. Thank you for your insights.